When you’re a small business owner, your responsibilities seem endless. Besides increasing sales and keeping costs down, there are other things you have to focus on to ensure your business succeeds. One of these critical aspects is risk management.
Misfortunes like arson or burglary have blindsided many businesses. And while you may believe you are protected from these issues, bad luck can always happen to you. Even if you are a careful business owner, you can still encounter a misfortune that results in financial losses. Therefore, it is critical to identify risks and take the necessary steps to mitigate them. Efficient solutions like a general liability insurance policy from Stampede Insurance can help businesses avoid costs that can hinder their business growth.
What are the most common insurance claims?
According to the data from several commercial insurance policies, these are the most common claims your venture could face:
- Burglary and theft;
- Customer slip and fall;
- Water and freezing damage;
- Wind and hail damage.
Let’s look at each of these claims and what you can do to avoid them.
Burglary and theft
This is one of the most common causes of liability claims for small ventures. Your business may be at risk of theft or burglary from an angry customer, a petty criminal or an annoyed employee. The question is, what can you do to mitigate such a significant risk? Luckily, you can take several security measures to decrease your chances of experiencing this misfortune.
Here’s what you can do to protect your business from burglary and theft:
- Use locks for doors and other sensitive areas on the property;
- Implement security equipment;
- Use a buddy system for deposits;
- Implement efficient security practices.
Internal threats can also lead to significant losses, and employee dishonesty can cause businesses billions of dollars. The solution for this is instilling accountability and good morale into your employees.
Customer slip and fall
If a customer gets injured due to a slip and fall accident while on your property, you may be vulnerable to damage claims and a lawsuit. Plus, there are other ways customers may get injured, such as being stroked by a product that falls from a top-shelf. If customers visit your business property frequently, you may consider getting General Liability Insurance. Doing this will allow you to submit an insurance claim if such an accident occurs on your property.
Also, you should perform regular inspections in your store or office to identify potential safety hazards, like unstable displays. Keeping your business property tidy and organized will keep your customers safe and give them a good impression.
Small business owners often minimize the likelihood of a fire. Unfortunately, they can happen, resulting in devastating consequences for your venture. There are so many causes that lead to commercial fires that business owners may not even be aware of. And they don’t think about how much money and time it takes to clean up the business and get it run again after the fire.
The police and the fire department won’t complete investigations right away, and insurance companies will also have to examine our property claims. Moreover, after a fire, it will be necessary to repair what’s been damaged. All these things translate into a complex process that requires a significant amount of time.
Water and freezing damage
This claim includes damage to physical locations caused by frozen water or water leaks. For instance, snow can lead to roof damage. When it comes to mitigating this risk, good property maintenance is the best way to prevent these hazards.
Thus, make sure to clean the roof regularly and keep it clear of debris to prevent it from accumulating water. Another critical thing to do is to inspect the plumbing frequently and not postpone any repairs if there are any issues. When there are freezing conditions, it’s also vital to cover your pipes.
Wind and hail damage
A tornado isn’t the only one that can substantially damage your business. High wind speeds can pull apart a building’s rooftop – and even its siding. Plus, rain and hail can also cause exterior damages with significant financial consequences.
You can prevent these hazards by ensuring skylights, pipes, HVAC units and other external elements are firmly secured so that a windstorm doesn’t swipe them away.
Other types of claims
Ventures that use automobiles or vehicles like ATVs or forklifts to transport people or products must be aware of the hazards of these operations. Suppose an employee operating the company’s vehicle or their personal vehicle for business purposes causes injury to another party. In such a situation, your venture is likely to be held liable.
If your business uses vehicles, there are some things you can do to mitigate the risks of accidents. For instance, you can implement an automobile safety program. Also, you must ensure only qualified persons use the vehicles, and certification and driving requirements can help to that end.
If third parties assert a claim that you or your employees harmed their reputation, you can be sued. Libel and slander are such types of defamation.
Business owners can avoid such claims by refraining from criticizing their competitors publicly. They should also be careful with the advertising materials they use and social media posts.
Supposing your business manufactures products that harm consumers or other people, you could face a product liability claim. Examples that lead to such claims include cosmetic products that burn the skin, food products that lead to illnesses and electronic devices catching fire.
Business owners can avoid these claims by keeping good records and monitoring customer complaints. Also, good manufacturing practices and proper testing are critical to preventing shabby products from entering the market.
There are indeed a lot of risks that small business owners can face. But these things don’t have to stop you from pursuing your dream. Taking suitable measures to prevent these hazards can help you protect your business.